AMD splits in ?smart asset strategy?

Creates a spin-off manufacturing company to focus on development
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Chip maker AMD has announced a deal with the Advanced Technology Investment Company (ATIC) that will see the vendors manufacturing capacity split off to create a new company.

The new firm, temporarily called the Foundry Company, will take on all $1.2 billion of AMD manufacturing debt so that the remainder of AMD will concentrate on development.

The move is backed by two Abu Dhabi based venture capital companies; one will invest $5.7 billion in to the creation of the Foundry Company while the other will buy more than $300 million worth of AMD stocks and warrants.

The Foundry Company will upgrade an existing fabrication plant in Dresden and plans to build another in New York to the latest standards.

AMD CEO Dirk Meyer commented: “Today is a landmark day for AMD, creating a financially stronger company with a tightened focus.”

The CEO of the Foundry Company is to be Doug Grose, with Hector Ruiz sitting as Chairman. Investor ATIC will hold half the board seats and own 55 per cent of the company.

Source: Channel Insider

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